U.S. President Barack Obama, visiting the world's most populous Muslim country, expressed concern Tuesday that Israelis and Palestinians aren't making the "extra effort" to secure a breakthrough for achieving Middle East peace.

Obama said he hasn't seen the kind of progress in negotiations that "could finally create a framework for a secure Israel living side by side in peace with a sovereign Palestine."

U.S. President Barack Obama shakes hands with Indonesian President Susilo Bambang Yudhoyono at Istana Merdeka in Jakarta. (Jason Reed/Reuters)

Asked at a news conference with Indonesia's President Suslilo Bambang Yudhoyono about Israeli settlement construction in East Jerusalem, Obama said: "Each of these incremental steps can end up breaking that trust between these parties."

Obama raised his Mideast concerns while appearing with Yudhoyono during his first visit to Indonesia as president to the country where he lived for four years as a child.

He marvelled over "sights and sounds" that evoked memories of the past and said Indonesia's landscape of today barely resembles the land where he went to live at age six in 1967 after his mother married an Indonesian man.

The president said he believes his administration has improved relations with the Muslim world but called this an "incomplete project," saying much more work needs to be done. Obama said policy differences will linger, but building better ties between Americans and the Muslim world will foster improved overall relations.

He voiced support for Yudhoyono's efforts to nurture a rapidly growing society at a time when Indonesia has been hit by earthquakes, a tsunami, and now a volcanic eruption. Concerns about volcanic ash caused the White House to shorten Obama's stay and hasten his takeoff Wednesday for the G20 summit in Seoul.

Mount Merapi, Indonesia's most volatile volcano, began erupting two weeks ago, unleashing volcanic gas, rock and debris that smothered villages and cut down people trying to flee. More than 150 people have been killed.

Obama's brief visit was shoehorned into a 10-day Asia trip, between three days spent in India and economic meetings in South Korea and Japan that start Thursday.

Obama and his wife Michelle disembark from Air Force One upon arrival in Jakarta. (Charles Dharapak/Associated Press)

Obama and his wife, Michelle, arrived on a grey, humid day in Indonesia's capital, and were greeted by dozens of dignitaries at Istana Merdeka, a white-columned presidential palace reminiscent of the White House. Obama greeted some of the officials in Indonesian as he shook their hands.

Indonesians all over the country of more than 17,000 islands gathered around television sets as Obama's plane touched down.

His quick stop to visit a country that is increasingly important player in Asia allowed him to speak to the values of democracy and religious tolerance, and reflect on his time in Indonesia as a boy.

The U.S. has increasingly embraced Indonesia as a moderate Muslim nation and partner in counter-terror efforts in the wake of attacks in Bali, Jakarta and elsewhere in the region.

"Lots of U.S. interests and lots of challenges and opportunities intersect in Indonesia," Ben Rhodes, deputy national security adviser for strategic communications, told reporters Monday.

Concerns over the volcanic ash cloud forced the White House to move up events Obama had planned for Wednesday, including a stop at Jakarta's Istiqlal Mosque and a speech at the University of Indonesia. Nearly all of the news media representatives travelling with Obama opted to leave Indonesia before the speech in order to reach South Korea ahead of the president.